“U.S. national security relies on private sector innovation to remain at the cutting-edge of military technology and to compete in the era of great power competition. I’m pleased to see the nation’s top-tier startups in the defense and national security space recognized on this list.”
— Congressman Rob Wittman (VA-01), Vice Chairman, House Armed Services Committee
Representative Wittman tours Varda Space Industries, a NatSec100 company
4 July 2023
The NatSec100 is our newly developed, annual ranked list of the top venture-funded defense and dual-use startups. It was developed to offer a data-driven snapshot of the evolving techno-security ecosystem.
The list is by no means a perfect indicator of the future success or failure of the companies it comprises; rather, it is intended to drive conversation around the emerging tech ecosystem in national security. While the DOD has long resisted “picking winners,” the NatSec100 ranks companies based on which are the comparative front-runners in the defense and national security space each year.
The top-tier startups on this year’s inaugural NatSec100 have collectively attracted an impressive $42 billion in funding to date. (To put that into perspective, DARPA has spent slightly less than $20 billion on R&D over the past five years.) They are developing a variety of technological capabilities vital to our national security and are funded by the world’s leading venture capital firms. And yet, the revenue generated by these companies from the federal government currently stands somewhere between $2 and $5 billion, a figure markedly lower than their collective funding. The companies included on this list are all private, so their revenue numbers are not public. We estimated annual revenue numbers from non-public information and public government contracts.
This discrepancy highlights a critical issue for policy makers: without substantial contracts from government customers, venture investors will put their money elsewhere. The result would be new defense-focused and dual-use startups finding it impossible to raise private capital, and existing ones pivoting to commercial customers or going out of business. This would have significant negative ramifications for our future national security capabilities.
As SVDG previously outlined in our Emerging Tech Readiness article, venture-funded defense and dual-use startups offer three advantages that make them particularly useful to national security: speed, scale, and selection. Ultimately, tech startups can offer a "catalog" of new, leading-edge technologies that buyers in need of immediate capabilities can access overnight. However, to date the national security sector has failed to provide consistent and sufficient contracts for emerging technology companies that would help these startup companies advance more quickly from their early and growth stages into profitability. This lack of sustainable government revenue may discourage both startups and their investors from participating in the national security market.
This is not to suggest that venture-backed companies have no future in the national security market. Rather, the DOD and IC should evaluate their own capability development and acquisition strategies and then take appropriate measures to ensure the sustained viability of defense and dual-use startups. To date, the DOD and IC have provided lip service and door prizes but no sustained commitments to ensure that the venture-funded defense and dual-use startups become part of major defense acquisition programs. The irony is that while the DOD/IC have been unable to make serious commitments to this ecosystem, China has embraced Civil/Military fusion, tightly integrating “commercial” startups and quickening China’s speed of innovation.
Methodology
Silicon Valley Defense Group (SVDG) collaborated with Franklin Templeton and Balyasny Asset Management to compile the NatSec100 list, taking into account the Office of the Under Secretary of Defense for Research and Engineering (OUSD(R&E))’s 14 Critical Technology Areas and private conversations with senior leaders from the DOD and intelligence community. Eligible companies are all engaged in the Department of Defense (DOD) critical technology areas, and the rankings reflect weighted, quantitative factors that allowed us to analyze companies’ size, growth, and momentum. Specifically, we analyzed headcount growth, total capital raised, and fundraising momentum, to assign a weighted score to each company. While these metrics are by no means perfect indicators of success for these companies, they demonstrate momentum in the world of venture-backed growth. All data gathered for the NatSec100 2023 is through the end of April 2023.
Critical Technology Areas and Investments: The Current Landscape
This year’s NatSec100 companies roughly align with Office of the Under Secretary of Defense for Research and Engineering (OUSD(R&E))’s 14 Critical Technology Areas. In particular, companies specializing in space technology and artificial intelligence/machine learning comprised the majority of the NatSec100. This is perhaps unsurprising due to the rapid pace of AI/ML development over the past year, in areas like generative AI, natural language processing, computer vision, large language models, etc. Space-related technologies have also accelerated, due in part to the commercialization of space and the significant increase in domestic launch capacity driven by SpaceX’s Falcon 9 rocket.
NatSec100 2023 Companies by Tech Vertical
Space has historically been an important national security domain, and the NatSec100 is evidence that this trend is continuing. Space technology developed by NASA and the DOD is illustrative of the traditional trend wherein technology created for national security purposes is later deployed for commercial use cases as well. The development of satellite communications and GPS is perhaps the best example of how space has historically been the ultimate dual use domain. The acceleration of this dual use trend is exemplified by the space tech companies listed in the NatSec100, nearly all of which serve both government and commercial customers across various space subsectors, including launch, manufacturing, and in-space services.
Key Investors
This year’s NatSec100 investors include mission-focused funds, prolific volume investors, top-tier venture capital (VC) firms, and financially-driven firms with a national security focus. Mission-focused funds like In-Q-Tel and Lockheed Martin Ventures are a natural fit for defense investing, and their mission is to identify and invest in companies developing cutting-edge technologies that serve United States national security interests. In-Q-Tel has invested in 34 of the 100 companies on this list, significantly more than any other investment group, albeit with relatively lower funding levels.
Alumni Ventures and Gaingels are prolific volume investors: Alumni Ventures was the most active venture capital firm in the US in 2022, while Gaingels was the third with 273 deals.This may explain their appearance on this list despite not having a specific national security or deep tech thesis. Leading VC firms like Andreessen Horowitz, Founders Fund, and Lux Capital have investors dedicated to deep tech and moonshot technologies, which tend to align with the DOD’s critical technology areas.
“IQT takes pride in our efforts to anticipate the needs of the intelligence and defense communities, making strategic investments in dual-use technology that our government partners can leverage to enhance national security for the U.S. and its allies,”
Top NatSec100 2023 Investors
Dual-Use Technologies
Some of the dual-use startups on the NatSec100 might be surprising because they’re not traditional national security companies. At #13 on the list is ICON, a construction technology company that 3D prints homes. The Army awarded ICON a $9M contract to explore printing housing for the military, and NASA funds ICON’s development of a space-based construction system intended to support lunar and Martian colonies. Whoop, the wearable health-monitoring startup at #41 on the list, has DOD contracts to support soldier health and well-being. And Chainalysis, the crypto forensics startup, helps the intelligence community monitor criminal activity and state-sponsored activity on the blockchain. Any startup that fits the DOD technology categories is eligible for the NatSec100, provided they have evidence of national security customers. As a result, the NatSec100 includes a variety of commercially focused companies who have also found federal market success.
“From day one, ICON embraced a dual-use vision, fueled by our determination to tackle both the global housing crisis and revolutionize military construction, while also partnering with NASA to build humanity’s first habitat on the moon. To fulfill these goals, forging a profound partnership across the government became an imperative”
Critical Technology Investments: Trendlines
Last year, SpaceX and Anduril constituted the two largest fundraises in all of venture capital, receiving $1.97B and $1.48B respectively.[1] However, deal count and capital raised actually declined from 2021, and has continued to decline so far in 2023. At its height in 2021, 97 startups on the NatSec100 received a total of $15.61B, and in 2022, 69 startups on the list received a total of $8.72B. But moving past SpaceX and Anduril, there’s a decline in total capital raised by the remainder of the NatSec100 list.
Policymakers should be wary of taking the $42 billion raised to date by NatSec100 companies for granted. The capital and deal flow of 2021 were likely spurred on by low-interest rates and a bullish stock market. In 2023, the market is much more uncertain. If this generation of defense tech startups fails due to a lack of government contracts, VC-funded defense innovation may decline precipitously.
NatSec100 2023 Deal Count by Year
“For the first time ever our national security is inexorably intertwined with commercial technology. The DoD’s traditional suppliers of defense tools, technologies, and weapons – the prime contractors and federal labs – are no longer the leaders in these next-generation technologies. Venture capital and startups have spent 50 years institutionalizing the rapid delivery of disruptive innovation and as we’re seeing on the Ukrainian battlefield they are changing the balance of power.”
NatSec100 2023 Capital Raised by Year (in millions)
“I am so thankful for the inventors, builders, founders, executives and dreamers who are building cutting edge technology products to defend our democracy and our national security interests. The path for each and everyone of them has been arduous and non-trivial, but if we think one generation out, we are likely to see a thousand new companies bloom from among the alumni of these successful companies”
Policy Recommendations
Better Reporting Metrics
It’s important to track the success of defense and dual-use startups in the national security market to judge to health of the national security innovation ecosystem. These metrics should monitor private funding and company growth, as well as government contracts and procurement of emerging technologies. It should track beneficiaries of the Defense Innovation Unit's (DIU) Other Transaction Authorities (OTAs), the recipients of AP-FIT grants, the Title III/Defense Production Act winners, and those that secure AFWERX STRATFI/TACFI awards. These will provide a clearer picture of the health of the national security innovation ecosystem and the effectiveness of DOD/IC efforts to support innovative challengers to the established defense industrial base.
Private Capital Partnership Consideration
Another step towards enhancing our techno-security landscape is to consolidate DOD efforts in connecting with private capital. These efforts, currently distributed across various departments like the Office of Strategic Capital, DIU, and Service-led initiatives, should be streamlined and consolidated. This centralization would improve efficiency, coordination, and accountability, and it could further be enhanced by linking with Intelligence Community efforts, like In-Q-Tel.
Nurturing New and Emerging Suppliers
If the DOD is truly committed to cultivating an emerging industrial base to supplement the established industrial base, it is essential to act decisively. This means seeking out and insisting on the inclusion of new suppliers, with a specific focus on those without a prior record of performance. It's an approach that promotes innovation and drives competitiveness.
The Space Force's approach with the new National Security Space Launch (NSSL) serves as a good model. Their Request for Proposals (RFP) expanded the supplier base, increasing the number of winners from two in the previous award to five in 2023. This not only broadened the playing field but also opened opportunities for 1-3 members of the NatSec100 to secure a contract, even without prior space exploration credentials.
However, not all sectors are embracing this forward-thinking strategy. A case in point is the Over-the-Horizon (OTH) munitions sector. The Ukraine conflict has highlighted the urgent need for new solid munition suppliers, like Ursa Major and Xbow. Yet, the first significant Defense Production Act (DPA) award was granted to the underperforming incumbent. This represented a missed opportunity to invest 10-20% of the contract in new entrants, which would have stimulated innovation and competition.
To ensure the growth and resilience of our national security infrastructure, it is paramount to incorporate and nurture emerging suppliers. This strategy fosters a more diverse and adaptable industrial base, better equipped to face the evolving challenges of the 21st century.
| Rank | Name | Company Description | Total funding raised (millions) | Headquarters | CEO | Year Founded |
|---|---|---|---|---|---|---|
| 1 | SpaceX | Develops spacecraft to make life multi-planetary; develops space launch vehicles to increase accessibility of materials | 8999.86 | Hawthorne, CA | Elon Musk | 2002 |
| 2 | Anduril | Defense technology company with the mission to transform US and allied military capabilities with advanced technology. | 2315.1 | Costa Mesa, CA | Brian Schimpf | 2017 |
| 3 | Databricks | Data analytics platform to simplify data | 3497.36 | San Francisco, CA | Ali Ghodsi | 2013 |
| 4 | Sierra Space | Commercial space transportation technology to facilitate life in space | 1438.22 | Louisville, CO | Tom Vice | 2021 |
| 5 | Chainalysis | Cryptocurrency investigation and compliance software | 536.72 | New York City, NY | Jonathan Levin | 2014 |
| 6 | Axiom Space | Provider of human-rated space infrastructure and services | 274.2 | Houston, TX | Michael Suffredini | 2016 |
| 7 | Relativity | Develops 3D printed rockets for launching payloads to orbit | 1334.54 | Long Beach, CA | Tim Ellis | 2015 |
| 8 | Grafana Labs | Developer of a performance monitoring platform | 569.23 | New York, NY | Raj Dutt | 2014 |
| 9 | Shield AI | AI based drone technology | 575 | San Diego, CA | Ryan Tseng | 2015 |
| 10 | Dataiku | Centralized data platform supporting data analytics and enterprise AI development | 851.8 | New York, NY | Florian Douetteau | 2013 |
| 11 | Skydio | Developer of autonomous drones for commercial and government use | 644.68 | Redwood City, CA | Adam Bry | 2014 |
| 12 | Scale AI | Data-centric platform accelerates AI training and development | 602.86 | San Francisco, CA | Alexandr Wang | 2016 |
| 13 | ICON | Construction-scale additive manufacturing | 451 | Austin, TX | Jason Ballard | 2017 |
| 14 | Lyten | Lithium-sulfur battery technology | 210 | San Jose, CA | Dan Cook | 2015 |
| 15 | SandboxAQ | Practical AI quantum software | 500 | New York, NY | Jack Hidary | 2022 |
| 16 | Dragos | Infrastructure cybersecurity software | 358.2 | Hanover, MD | Robert M. Lee | 2016 |
| 17 | Slingshot Aerospace | Space simulation and analytics platform | 81.82 | El Segundo, CA | Melanie Stricklan | 2017 |
| 18 | Venus Aerospace | Developing hypersonic aircraft | 48.28 | Houston, TX | Sassie Duggleby | 2020 |
| 19 | DataRobot | Enterprise AI platform to automate data | 1048.21 | Boston, MA | Debanjan Saha | 2012 |
| 20 | Ursa Major Technologies | Developer of turnkey propulsion technologies for engines | 286.1 | Berthoud, CO | Joe Laurienti | 2015 |
| 21 | Rubrik | Data automation for hybrid clouds | 1056.73 | Palo Alto, CA | Bipul Sinha | 2014 |
| 22 | Versa Networks | Integrated SDN platform to integrate cloud, networking, and security services | 330.25 | Santa Clara, CA | Kelly Ahuja | 2009 |
| 23 | ThoughtSpot | Enterprise analytics platform centralizes and accelerates data | 677.45 | Mountain View, CA | Sudheesh Nair | 2012 |
| 24 | PsiQuantum | First utility-scale quantum computer | 665 | Palo Alto, CA | Jeremy O'Brien | 2016 |
| 25 | Capella Space | Satellite radar imagery technology | 283.99 | San Francisco, CA | Payam Banazadeh | 2016 |
| 26 | Stoke Space Technologies | Developer of reusable rockets | 74.54 | Kent, WA | Andy Lapsa | 2019 |
| 27 | SambaNova Systems | Hardware for accelerated analytics and AI | 1136.6 | Palo Alto, CA | Rodrigo Liang | 2017 |
| 28 | Applied Intuition | Advanced simulation infrastructure software for autonomous vehicles | 351.5 | Mountain View, CA | Qasar Younis | 2017 |
| 29 | Epirus | HPM technology software to counter UAS | 290.59 | Torrance, CA | Kenneth Bedingfield | 2018 |
| 30 | Impulse Space | Orbital maneuvering vehicles for economical delivery | 30 | El Segundo, CA | Thomas Mueller | 2021 |
| 31 | Blue Origin | Space technologies for sustainable expansion | 500 | Kent, WA | Bob Smith | 2000 |
| 32 | CloudBees | Automated cloud platform for software delivery | 454.55 | San Jose, CA | Anuj Kapur | 2010 |
| 33 | Cerebras Systems | AI-accelerating computing chips | 723 | Sunnyvale, CA | Andrew Feldman | 2015 |
| 34 | Astranis | Satellite internet company for regional connectivity and broadcasting | 393.92 | San Francisco, CA | John Gedmark | 2015 |
| 35 | ABL Space Systems | Low-cost vehicles to launch small satellites | 419.35 | El Segundo, CA | Harry O'Hanley | 2017 |
| 36 | Infleqtion | Develops software-configured, quantum-enabled products | 184.5 | Louisville, CO | Scott Faris | 2007 |
| 37 | VAST Data | Data platform designed to accelerate enterprises | 263 | New York, NY | Renen Hallak | 2016 |
| 38 | EOI Space | Low-flying satellites to collect ultra-high-resolution imagery | 11.07 | Louisville, CO | Christopher Thein | 2017 |
| 39 | Muon Space | Develops climate-focused satellite constellation technology | 35 | Mountain View, CA | Jonny Dyer | 2021 |
| 40 | Opaque Systems | First confidential AI platform | 22 | San Francisco, CA | Rishabh Poddar | 2020 |
| 41 | Whoop | Wearable performance optimization device | 407.4 | Boston, MA | Will Ahmed | 2011 |
| 42 | Saildrone | Autonomous marine surface vehicles | 186.2 | Alameda, CA | Richard Jenkins | 2012 |
| 43 | Loft Orbital | Satellite platform to assist the launch and operations of satellites | 156.16 | San Francisco, CA | Pierre-Damien Vaujour | 2017 |
| 44 | RED 6 | Augmented reality (AR) for military training applications | 110.9 | Orlando, FL | DANIEL ROBINSON | 2018 |
| 45 | SiMa.ai | Software-centric platform accelerates high-performance machine learning inference | 187.8 | San Jose, CA | Krishna Rangasayee | 2018 |
| 46 | Formlabs | Printing platform designed to print parts with complex geometries | 253.13 | Somerville, MA | Maxim Lobovsky | 2011 |
| 47 | BigID | Data-driven protection and privacy compliance platform | 196.26 | New York, NY | Dimitri Sirota | 2016 |
| 48 | Lambda | Software-enhanced compute systems and GPU cloud services | 68.21 | San Jose, CA | Stephen Balaban | 2012 |
| 49 | Vannevar Labs | Machine learning products for critical national security problems | 91.1 | Palo Alto, CA | Brett Granberg | 2019 |
| 50 | Fictiv | On-demand digital manufacturing ecosystem | 195.62 | San Francisco, CA | Dave Evans | 2013 |
| 51 | Ayar Labs | Electronic-photonic chipset for computers | 195.1 | Emeryville, CA | Alex Wright-Gladstein | 2015 |
| 52 | Federated Wireless | CBRS shared spectrum technology for wireless industry | 206 | Arlington, VA | Iyad Tarazi | 2012 |
| 53 | Dedrone | Counter-drone security technology platform | 133.01 | Sterling, VA | Aaditya Devarakonda | 2014 |
| 54 | RRAI | Develops autonomous and semi-autonomous transportation vehicles | 228 | Clarksburg, MD | Alberto Lacaze | 2002 |
| 55 | Merlin Labs | Autonomous flight technology designed for fixed-wing aircraft | 146 | Boston, MA | Matt George | 2018 |
| 56 | Hermeus | Developer of a hypersonic aircraft | 118.9 | Atlanta, GA | AJ Piplica | 2018 |
| 57 | SparkCognition | AI to analyze increasingly complex data stores | 340.49 | Austin, TX | Amir Husain | 2013 |
| 58 | Firefly Aerospace | Develops launch vehicles for commercial launches to orbit | 30.2 | Cedar Park, TX | Bill Weber | 2017 |
| 59 | Kymeta | Low-power satellite antenna for mobile satellite-cellular connectivity | 524.87 | McLean, VA | S. Douglas Hutcheson | 2012 |
| 60 | UVeye | Vehicle inspection systems to detect threats or modifications of vehicles | 201.56 | Teaneck, NJ | Amir Hever | 2016 |
| 61 | Airspace Technologies | Technology-enabled logistic platform to expedite deliveries | 138.5 | Carlsbad, CA | Nicholas Bulcao | 2016 |
| 62 | Boom Supersonic | Manufacturer of sustainable supersonic aircraft | 269.13 | Dove Valley, CO | Blake Scholl | 2014 |
| 63 | Sepio | Risk management platform | 37 | Rockville, MD | Yossi Appleboum | 2016 |
| 64 | Nozomi Networks | Online cybersecurity platform | 174.05 | San Francisco, CA | Edgard Capdevielle | 2013 |
| 65 | Gecko Robotics | Robots for comprehensive asset inspections | 120.45 | Pittsburgh, PA | Jake Loosararian | 2013 |
| 66 | 6K | Microwave-based plasma technology to produce nanomaterials | 214.1 | North Andover, MA | Aaron Bent | 2014 |
| 67 | Interos | Logistics assurance platform to manage supply-chain risk | 258.62 | Arlington, VA | Jennifer Bisceglie | 2005 |
| 68 | Albedo | Constellation of satellites that capture both visible and thermal imagery simultaneously | 60.22 | Broomfield, CO | Topher Haddad | 2020 |
| 69 | Brinc | 2-way communication drones and aerospace technology systems | 82.2 | Seattle, WA | Blake Resnick | 2017 |
| 70 | Swift Navigation | GPS technology for automated navigation for autonomous applications | 200.18 | San Francisco, CA | Tim Harris | 2012 |
| 71 | Rebellion Defense | Mission-focused, defense and security AI products | 223.8 | Washington, DC | Barry Sowerwine | 2019 |
| 72 | ATLAS Space Operations | Satellite communications optimization control software | 34.8 | Traverse City, MI | Sean McDaniel | 2015 |
| 73 | Liquid Instruments | Developer of modern test and measurement devices based on a software-configurable hardware platform | 58.96 | San Diego, CA | Daniel Shaddock | 2014 |
| 74 | Orbit Fab | Space refueling technology designed to offer remote monitoring services | 29.15 | Lafayette, CO | Daniel Faber | 2018 |
| 75 | Firehawk Aerospace | Hybrid rocket engines with 3D-printed fuel | 26.75 | Addison, TX | Will Edwards | 2019 |
| 76 | Morpheus Space | Sustainable spacecraft propulsion systems | 28.07 | El Segundo, CA | Daniel Bock | 2018 |
| 77 | X-Bow | Affordable rocket propellant for orbital access | 29.2 | Huntsville, AL | Jason Hundley | 2016 |
| 78 | Mirantis | Technology platform for public open cloud infrastructure | 254.07 | Campbell, CA | Adrian Ionel | 1999 |
| 79 | Rescale | Cloud-based software and hardware infrastructure platform for scientific and engineering simulations | 157.4 | San Francisco, CA | Joris Poort | 2011 |
| 80 | Voyager Space | Aviation and aerospace technology for space exploration | 177.8 | Denver, CO | Dylan Taylor | 2019 |
| 81 | HawkEye 360 | space-based radio frequency mapping and analytics system for geospatial data analytics | 305 | Herndon, VA | John Serafini | 2015 |
| 82 | Automation Anywhere | Workforce-oriented AI robotic process automation software | 1172.97 | San Jose, CA | Mihir Shukla | 2003 |
| 83 | Truera | Model Intelligence platform for business impact | 42.28 | Redwood City, CA | William Uppington | 2019 |
| 84 | Second Front Systems | Accelerating commercial software development, testing, and deployment into national security networks | 44.23 | Wilmington, DE | Peter R Dixon | 2014 |
| 85 | Phantom Space | Democratizing space transportation technology | 26.66 | Tucson, AZ | Jim Cantrell | 2019 |
| 86 | Xwing | Autonomous flight technology for various aircraft | 58 | San Francisco, CA | Marc Piette | 2016 |
| 87 | LeoLabs | Secure commercial operations in low Earth orbit | 82 | Menlo Park, CA | Daniel Ceperley | 2016 |
| 88 | SkySafe | Drone defense technology for airspace security | 45 | San Diego, CA | Grant Jordan | 2015 |
| 89 | Spaceflight Industries | Aerospace launch mission services | 265.75 | Bellevue, WA | Tiphaine Louradour | 2009 |
| 90 | Snorkel | AI tool to extract information from text documents | 138.25 | Redwood City, CA | Alexander Ratner | 2015 |
| 91 | Hypori | Virtual mobile infrastructure to eliminate security risks | 30.5 | Reston, VA | Jared Shepard | 2021 |
| 92 | Stellar Cyber | Automated security operations platform | 59.8 | San Jose, CA | Changming Liu | 2015 |
| 93 | Shift5 | Cybersecurity platform to defend operational technology platforms | 105.5 | Arlington, VA | Josh Lospinoso | 2019 |
| 94 | Primer | AI used to automate the analysis of massive datasets | 237 | San Francisco, CA | Sean Moriarty | 2014 |
| 95 | SpiderOak | Collaboration tool, online backup and file hosting service | 36.9 | Lenexa, KS | Dave Pearah | 2007 |
| 96 | Xplore | Commercial space services fueled by a multi-sensor platform to store, transmit data, achieve data fusion and on orbit processing | 25.2 | Redmond, WA | Jeff Rich | 2018 |
| 97 | CesiumAstro | Software-defined communication payloads for airborne and in-orbit platforms | 88.2 | Broomfield, CO | Shey Sabripour | 2017 |
| 98 | Eclypsium | Device security platform unguarded firmware and hardware defense | 63.04 | Portland, OR | Yuriy Bulygin | 2017 |
| 99 | Varda Space Industries | Platform for in-space manufacturing | 42 | El Segundo, CA | Will Bruey | 2020 |
| 100 | Elroy Air | Autonomous aircraft systems and software to expedite shipping services | 56 | San Francisco, CA | David Merrill | 2016 |